US surgical equipment maker Hill-Rom to buy Welch Allyn for $2.05 bn

Hill-Rom Holdings Inc, a US manufacturer of hospital beds and surgical equipments for the health care industry, yesterday struck a deal to buy privately held Welch Allyn for about $2.05 billion in cash and stock.

Under the terms of the agreement, Welch Allyn shareholders will receive $1.625 billion in cash and approximately 8.1 million newly-issued shares of Hill-Rom common stock.

Post closing, which is expected before the end of September 2015, Welch Allyn shareholders will own approximately 13 per cent of the combined company.

No single Welch Allyn shareholder will own more than approximately one per cent of Hill-Rom equity.

Based in Skaneateles Falls, New York, Welch Allyn is a leading manufacturer of medical diagnostic equipment and accessories and EMR-connected vital signs and cardiac monitoring devices.

The 100-year company currently has annual revenue of about $700 million and employs nearly 2,600 people in 26 different countries.

The combined company is expected to generate revenue of $2.6 billion and over $500 million in Adjusted EBITDA, Hill-Rom said in a statement.

Hill-Rom is a leading worldwide manufacturer and provider of medical technologies and related services for the health care industry, including patient support systems, safe mobility and handling solutions, non-invasive therapeutic products for a variety of acute and chronic medical conditions, medical equipment rentals, surgical products and information technology solutions.

John Greisch, president and CEO of Hill-Rom, said, ''Hill-Rom is at the forefront of improving the healthcare delivery system, and this compelling combination further positions Hill-Rom to play an increasingly important role in improving patient care. Hill-Rom has aggressively pursued external growth opportunities that leverage Hill-Rom's existing channel strength to advance our strategic objectives of being a stronger, more diversified organization with the scale, resources and geographic reach to drive value across our business.

Steve Meyer, president and CEO of Welch Allyn, said, ''Combining with Hill-Rom will enable Welch Allyn to build on our important accomplishments over the last 100 years and play an even bigger role serving and meeting the evolving needs of patients and healthcare systems around the world.''